ICE mortgage equity reaches record $18T as U.S. home price growth accelerates

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ICE mortgage equity hits record

Highlights

ICE reports mortgage holder equity hits a record $18 trillion in Q2 2026, with 47.5 million borrowers holding $11.7 trillion in tappable equity.
Annual U.S. home price growth accelerates to 1.5% in July 2026, the sharpest monthly gain since mid-2023, fueled by lower mortgage rates earlier in the year.
About 813,000 borrowers remain underwater (up 44% year-over-year), with wider mortgage rate spreads and FHA/VA borrowers facing larger payment disparities and discounts on REO properties reaching 27.5%.

August housing data points to stronger equity and prices

As reported by Intercontinental Exchange, its August 2026 Mortgage Monitor Report shows annual home price growth rises to 1.5% in July, marking a fifth straight month of acceleration and the sharpest single-month increase since mid-2023.

The company says lower mortgage rates earlier in 2026 help support demand and push both home prices and borrower equity higher. Andy Walden, head of mortgage and housing market research at ICE, says the spring market gives a meaningful boost to prices and equity, although higher rates since early in the year may limit further acceleration in the second half.

ICE says mortgage holder equity reaches a record $18 trillion in the second quarter. Within that total, 47.5 million mortgage holders hold $11.7 trillion in tappable equity, or about $212,000 per borrower on average.

Borrower stress and lending gaps remain in the market

Despite the broader gains, the report says about 813,000 borrowers remain underwater, up 44% from a year earlier. ICE says those borrowers are concentrated among FHA and VA loan holders, buyers who purchased between 2022 and 2025, and homeowners in Texas and Florida, where price declines from peak levels are more pronounced.

The report also finds similarly qualified borrowers are locking in notably different mortgage rates. Among conforming purchase borrowers in 2026, the average spread is 38 basis points, which ICE says adds about $76 per month, or roughly $5,790 over the first five years, on a $300,000 mortgage.

For FHA and VA borrowers, the spread widens to 47 and 48 basis points respectively, with the largest variation affecting borrowers with lower credit scores, smaller loan balances, higher loan-to-value ratios and government-backed loans. ICE also says buyers of bank-owned REO properties purchase at a 27.5% discount to comparable sales in June, one of the widest gaps in more than two decades, even as foreclosure rates and distressed buying opportunities remain limited in Florida, Texas, California and the Mountain West.

Our earlier report on higher-for-longer U.S. interest rates explained how markets were pricing the possibility of another Federal Reserve hike as inflation stayed above target. We noted that rising Treasury yields were already feeding into higher 15- and 30-year fixed mortgage rates, keeping affordability pressures elevated for households across mortgages and other consumer borrowing.

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